One major milestone for the industry was the passage of the 2018 Farm Bill. Although the bulk of the spending in the bill concerns the Supplemental Nutrition Assistance Program and provisions related to crop insurance, the biggest takeaway for cannabis businesses was a change in the legal status of hemp.

The legalization of hemp and its removal from Schedule I of the Controlled Substances Act is viewed as a major step forward for the cannabis industry because it legalizes hemp-derived cannabidiol, or CBD.

The drug has no psychoactive effects, but has beneficial analgesic and anti-inflammatory properties.

Benzinga asked cannabis experts and executives about what the adoption of the Farm Bill means for the CBD segment and the broader cannabis industry.

'Most Significant Change' Since Controlled Substances Act

The legalization of hemp means that the plant will join its rightful place in the ranks of other crops cultivated in the U.S. Most cultivated hemp is used to extract CBD, but it has other uses in textiles, paper and other industries, with more potential uses still being discovered. Therefore, allowing U.S. farmers to legally cultivate hemp will create many benefits for the economy outside the CBD segment.

Hemp will become a commodity, which means that it can be traded on a market, said Kristen Nichols, editor of Hemp Industry Daily.

Farmers who grow hemp now have had to use other sources like Facebook to find sellers for their crops and determine the price. With the Farm Bill's passage, the oversight of hemp will be moved to the Department of Agriculture.

“It is no exaggeration to say this Farm Bill is all but nuclear for the cannabis industry broadly, not just hemp. It is the most significant change to the American drug policy since the adoption of the Controlled Substances Act in 1971,” Nichols said.

The CBD Era Begins

The aspect of hemp legalization that most industry experts are looking forward to is the federal legalization of hemp-derived CBD. New Frontier Data’s Hemp Business Journal estimates that the market for hemp-derived CBD products will grow from $390 million in 2018 to to $1.3 billion by 2022.

The legalization of CBD will kickstart this market growth. “"The legalization of hemp is the official launch of the 'CBD era,’” said Marimed CEO Robert Fireman.

MariMed and other companies are ready to roll out new CBD products and invest more in research and development programs to introduce products like edibles and topicals.

“The Farm Bill will enable Americans to enjoy legal access to a host of hemp-derived CBD-based solutions, which are already renowned for their health and wellness benefits," Fireman said. "We are excited about the potential of legalized hemp to benefit millions of Americans in many ways."

More Research On Benefits of CBD, Cannabis

The previous Farm Bill, passed in 2014, legalized the cultivation of hemp for research purposes.

With hemp and CBD products legally on sale nationwide, more funds should flow into research programs for both consumer and medical products.

“By lifting the restrictions on hemp CBD medical research, scientists can now explore how CBD works and get a better understanding of how it can be better used to treat specific conditions,” said George Archos, CEO of Verano Holdings.

Given that CBD is one of the most-present components in cannabis, the results of research could help accelerate the legalization of cannabis and its removal from Schedule 1, the CEO said.

A Long Overdue Measure

Experts are applauding the legalization of hemp as a major step forward for the U.S. economy.

It will unlock “the health and wellness power of CBD from both hemp and cannabis” and enable “farmers to produce a lucrative and eco-friendly agricultural crop that has uses across multiple industries,” Verano CEO Archos said.

George Jage, former CEO of High Times subsidiary Dope Media, now president of MJLink.com, said the move was long overdue.

"While the money and excitement is in cannabis currently, the potential impact of hemp utilization across a multitude of industries with an unprecedented number of applications will fuel an economic revolution."